Minecraft is a procedurally generated open world video game.
For multiplayer, the computer hosting the game has to be able to load the portion of the world for each player. Having a dedicated computer hosting the server allows for much smoother gameplay experience then trying to have a single PC both run the server and client.
The machine we used for the server was literally one of my wife’s old work PCs and we just use it to host these types of games. We previously ran an ARC: Survival Evolved server on it.